1. Order Fulfillment, eCRM, and Other Support Services
Chapter 13
Order Fulfillment, eCRM,
and Other Support Services

2. Learning Objectives Describe the role of support services in EC.
Define EC order fulfillment and describe the EC order fulfillment process.
Describe the major problems of EC order fulfillment.
Describe various solutions to EC order fulfillment problems.
Electronic Commerce
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3. Learning Objectives
Describe CRM, its methods, and its relationship with EC.
Describe eCRM implementation and tools.
Describe other EC support services.
Discuss the drivers of outsourcing support services and the use of ASPs.
Electronic Commerce
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4. Order Fulfillment and Logistics: An Overview
Overview of Order Fulfillment
order fulfillment
All of the activities needed to provide customers with ordered goods and services, including related customer services
back-office operations
The activities that support fulfillment of sales, such as accounting and logistics
front-office operations
The business processes, such as sales and advertising, that are visible to customers
Electronic Commerce
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5. Exhibit 13.1 E-Commerce Services
Electronic Commerce
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6. Order Fulfillment and Logistics: An Overview
Overview of Logistics
logistics
The operations involved in the efficient and effective flow and storage of goods, services, and related information from point of origin to point of consumption
Electronic Commerce
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7. Order Fulfillment and Logistics: An Overview
The EC Order Fulfillment Process
Step 1: Making sure the customer will pay
Step 2:Checking for in-stock availability
Step 3:Arranging shipments
Step 4: Insurance
Step 5: Replenishment
Step 6: In-house production
Step 7: Use suppliers
Step 8: Contacts with customers
Step 9: Returns
Electronic Commerce
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8. Order Fulfillment and Logistics: An Overview
The EC Order Fulfillment Process
reverse logistics
The movement of returns from customers to vendors
e-logistics
The logistics of EC systems, typically involving small parcels sent to many customers’ homes (in B2C)
Electronic Commerce
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9. Order Fulfillment and Logistics: An Overview
Traditional Versus EC Logistics
Traditional logistics deal with movement of large amounts of materials to a few destinations
E-logistics shipments typically are small parcels sent to many customers’ homes
Electronic Commerce
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10. Problems in Order Fulfillment
Typical Supply Chain Problems
The inability to deliver products on time
High inventory costs
Quality problems due to misunderstandings
Shipments of wrong products, materials, and parts
Cost to expedite operations or shipments is high
Electronic Commerce
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11. Problems in Order Fulfillment
Why Supply Chain Problems Exist
Problems along the EC supply chain stem from uncertainties and from the need to coordinate several activities, internal units, and business partners
third-party logistics (3PL) suppliers
External, rather than in-house, providers of logistics services
Electronic Commerce
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12. Solutions to Order Fulfillment Problems
Improvements in the Order-Taking Process
Improve the order-taking process and its links to fulfillment and logistics
Implement linkages between order-taking and payment systems
Electronic Commerce
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13. Solutions to Order Fulfillment Problems
Warehousing and Inventory Management Improvements
warehouse management system (WMS)
A software system that helps in managing warehouses
Other Inventory Management Improvements
Automated Warehouses
Using Wireless Technologies
Using RFID to improve WMS
Electronic Commerce
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14. Solutions to Order Fulfillment Problems
Speeding Deliveries
Same day, even same hour, delivery
Supermarket deliveries
Failed delivery companies
Partnering Efforts and Outsourcing Logistics
Comprehensive logistics services
Outsourcing logistics
Electronic Commerce
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15. Solutions to Order Fulfillment Problems
Handling Returns
Return the item to the place where it was purchased
Separate the logistics of returns from the logistics of delivery
Completely outsource returns
Allow the customer to physically drop the returned item at a collection station
Auction the returned items
Electronic Commerce
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16. Solutions to Order Fulfillment Problems
Order Fulfillment in B2B
Using E-Marketplaces and Exchanges to Ease Order Fulfillment Problems in B2B
A company-centric marketplace can solve several supply chain problems
Using an extranet provides an ordering system
A vertical exchange connects thousands of suppliers
Order Fulfillment in Services
May involve more information processing, which requires more sophisticated EC systems
Electronic Commerce
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17. Exhibit 13.5 B2B Buy and Ship Options
Electronic Commerce
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18. Solutions to Order Fulfillment Problems
Innovative E-Fulfillment Strategies
merge-in-transit
Logistics model in which components for a product may come from two different physical locations and are shipped directly to customer’s location
rolling warehouse
Logistics method in which products on the delivery truck are not pre-assigned to a destination, but the decision about the quantity to unload at each destination is made at the time of unloading
Electronic Commerce
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19. CRM and Its Relationship with EC
What is CRM: Definitions, Types, and Classifications
customer relationship management (CRM)
A customer service approach that focuses on building long-term and sustainable customer relationships that add value both for the customer and the company
Electronic Commerce
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20. CRM and Its Relationship with EC
Types of CRM Activities
Operational
Analytical
Collaborative
Classification of CRM Programs
Loyalty programs.
Prospecting.
Save or win back.
Cross-sell/up-sell.
Electronic Commerce
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21. CRM and Its Relationship with EC
eCRM
Customer relationship management conducted electronically
The Scope of CRM
The three levels of CRM:
Foundation of service
Customer-centered services
Value-added services
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22. CRM and Its Relationship with EC
The Extent of Service
Customer acquisition (prepurchase support)
Customer support during purchase
Customer fulfillment (purchase dispatch)
Customer continuance support (postpurchase)
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23. CRM and Its Relationship with EC
Benefits of CRM
The provision of superior customer care through the use of the Internet and IT technologies
Limitations of CRM
Requires integration with a company’s other information systems, which may not be an easy task
Justifying the expense of CRM is not easy
Electronic Commerce
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24. CRM and Its Relationship with EC
CRM Implementation Issues
Five factors that are required to implement a CRM program effectively:
Customer-centric strategy
Commitments from people
Improved or redesigned processes
Software technology
Infrastructure
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25. CRM and Its Relationship with EC
Integrating CRM into the Enterprise
The integration of ERP and CRM must include low-level data synchronization as well as business process integration so that the integrity of business roles can be maintained across systems and workflow tasks can pass between the systems
Such integration also ensures that organizations can perform business intelligence across systems
Electronic Commerce
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26. CRM and Its Relationship with EC
Justifying Customer Service and CRM Programs
metrics
Performance standards; may be quantitative or qualitative
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27. CRM and Its Relationship with EC
Metrics in Customer Service and CRM
Response time
Site availability
Download time
Timeliness
Security and privacy
On-time order fulfillment
Return policy
Navigability
Electronic Commerce
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28. Delivering Customer Service in Cyberspace: CRM Applications and Tools
Classifications of CRM Applications
Customer-facing applications
Customer-touching applications
Customer-centric intelligence applications
Online networking and other applications
Electronic Commerce
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29. Exhibit 13.8 CRM Applications
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30. Delivering Customer Service in Cyberspace: CRM Applications and Tools
Customer-Facing Applications
Customer Interaction Centers
customer interaction center (CIC)
A comprehensive service entity in which EC vendors address customer-service issues communicated through various contact channels
telewebs
Call centers that combine Web channels with portal-like self-service
Electronic Commerce
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31. Delivering Customer Service in Cyberspace: CRM Applications and Tools
Customer-Facing Applications
Intelligent Agents in Customer Service and Call Centers
autoresponders
Automated reply systems (text files returned via ) that provide answers to commonly asked questions
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32. Exhibit 13.9 Intelligent Agents in Call Centers
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33. Delivering Customer Service in Cyberspace: CRM Applications and Tools
Customer-Facing Applications
sales force automation (SFA)
Software that automates the tasks performed by sales people in the field, such as data collection and its transmission
Field Service Automation
Manage customer service requests, service orders, service contracts, service schedules, and service calls
Provide planning, scheduling, dispatching, and reporting features to field service representatives
Electronic Commerce
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34. Delivering Customer Service in Cyberspace: CRM Applications and Tools
Customer-Touching Applications
Personalized Web pages
E-commerce applications
Campaign management
Electronic Commerce
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35. Delivering Customer Service in Cyberspace: CRM Applications and Tools
Customer-Touching Applications
Web self-service
Activities conducted by users on the Web to find answers to their questions (e.g., tracking) or for product configuration
Self-Tracking
FAQ page
A Web page that lists questions that are frequently asked by customers and the answers to those questions
Self-Configuration and Customization
Electronic Commerce
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36. Delivering Customer Service in Cyberspace: CRM Applications and Tools
Customer-Centric Applications
Data Reporting and Warehousing
Data Reports
data warehouse
A single, server-based data repository that allows centralized analysis, security, and control over the data
Data Analysis and Mining
Electronic Commerce
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37. Delivering Customer Service in Cyberspace: CRM Applications and Tools
Online Networking
Forums
Chat rooms
Usenet groups
newsletters
Discussion lists
Newsletters
Discussion Lists
Electronic Commerce
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38. Delivering Customer Service in Cyberspace: CRM Applications and Tools
mobile CRM
The delivery of CRM applications to any user, whenever and wherever needed. This is done by use of the wireless infrastructure and/or mobile and wearable devices
Voice Communication
Language Translation
The Role of Knowledge Management and Intelligent Agents in CRM
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39. Other EC Support Services
Consulting Services
CRM Suites
Directory Services, Newsletters, and Search Engines
Directory services
Newsletters
Search engines and news aggregators
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40. Other EC Support Services
Some More EC Support Services
Trust Services
Trademark and Domain Names
Digital Photos
Global Business Communities
Access to Commercial Databases
Online Consulting
Knowledge Management
Client Matching
E-Business Rating Sites
Security and Encryption Sites
Web Research Services
Coupon-Generating Sites
Electronic Commerce
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41. Outsourcing EC Support Services
Why Outsource EC Services?
A desire to concentrate on the core business
The need to have services up and running rapidly
Lack of expertise (experience and resources) for many of the required support services
The inability to have the economy of scale enjoyed by outsourcers, which often results in high costs for in-house options
Electronic Commerce
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42. Outsourcing EC Support Services
Why Outsource EC Services?
The inability to keep up with rapidly fluctuating demands if an in-house option is used
The number of required services, which usually are simply too many for one company to handle
Electronic Commerce
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43. Outsourcing EC Support Services
Why Outsource EC Services?
The typical process of developing and managing EC applications has four steps:
EC strategy formulation
Application design
Building (or buying) the application
Hosting, operating, and maintaining the EC site
Electronic Commerce
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44. Exhibit 13.12 E-Commerce Application Development Process
Electronic Commerce
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45. Outsourcing EC Support Services
IT Outsourcing and Application Service Providers
Internet malls
ISPs
Telecommunication companies
Software houses
Outsourcers and others
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46. Outsourcing EC Support Services
IT Outsourcing and Application Service Providers
application service provider (ASP)
An agent or vendor who assembles the functions needed by enterprises and packages them with outsourced development, operation, maintenance, and other services
Electronic Commerce
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47. Managerial Issues Have we planned for order fulfillment?
How should we handle returns?
Do we want alliances in order fulfillment?
What EC logistics applications would be useful?
How is our response time?
How do we measure and improve customer service?
Electronic Commerce
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48. Managerial Issues Is CRM for real?
Do we have to use electronically supported CRM?
EC consultants are expensive. Should we use them?
Should we outsource EC services?
Electronic Commerce
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49. Summary The role of support services in EC.
The order fulfillment process.
Problems in order fulfillment.
Solutions to order fulfillment problems.
CRM, its technologies, and EC connection.
Implementing customer service online.
Other support services.
Outsourcing EC services and using ASPs.
Electronic Commerce
Prentice Hall © 2006